D.C. Current

Fear Moves in on REIT Street

An SEC probe of the securities pounds prices and sends yields soaring. But the industry is taking it all in stride.

Ah, the sweet smell of panic. Investor hysteria over a relatively benign Securities and Exchange Commission inquiry into the mortgage real-estate investment trust sector has sent dozens of the high-yielding securities into bargain-basement territory. As a result, the yields of some mortgage REITs, which tend to be aggressively leveraged, are now in double-digits. (Leverage lends the stocks and their returns a high degree of volatility, so such investments are not for the faint of heart.)